Tax Year 2026-27 vs FY 2025-26 / AY 2026-27: Which to Select?

Choose the period when the salary was earned, not simply the year when you open the calculator or file a return. Tax Year 2026-27 and Assessment Year 2026-27 sound similar, but they do not describe the same income period.

Reviewed 28 October 2026. This guide explains the two periods currently supported by our India CTC to In-Hand Salary Calculator. It is an educational explanation, not a tax return or a decision on your individual filing obligations.

Quick answer: which period covers your salary?

• Income earned from 1 April 2025 to 31 March 2026: select FY 2025-26 / AY 2026-27.
• Income earned from 1 April 2026 to 31 March 2027: select Tax Year 2026-27 (current).

The Income Tax Department explains that the Tax Year terminology applies to income earned from FY 2026-27 onward under the Income-tax Act, 2025. Earlier periods remain subject to the transition provisions. See the official objective and scope FAQ.

What do FY, AY and Tax Year mean?

Under the earlier terminology, the financial year or previous year identifies when income was earned, while the following assessment year identifies the associated assessment period. That is why FY 2025-26 pairs with AY 2026-27.

The new Tax Year label directly identifies the income period. For the current full-year salary estimate, Tax Year 2026-27 runs from April 2026 through March 2027. Calendar year 2026, by contrast, includes parts of two income periods. Do not use a January-to-December total as though it were automatically the annual salary input for either option.

Filing in 2026 does not automatically mean Tax Year 2026-27

The Department's income tax returns FAQ distinguishes a return for FY 2025-26, filed for AY 2026-27 under the earlier Act, from a return for Tax Year 2026-27 after that income period ends. The filing date alone does not determine the applicable income year.

Our calculator estimates salary and deductions. It does not select or submit an ITR form, calculate a filing deadline or decide whether a revised return is available. Confirm the period and filing requirements on the official portal or with a qualified tax professional.

How to use the calculator's year selector

1. Identify the April-to-March period that matches the salary you want to estimate.
2. Choose that period in the salary calculator.
3. Enter CTC and the salary structure for that period, rather than automatically copying your latest offer into a historical estimate.
4. Check employer PF, employee PF, gratuity provision, professional tax, variable pay and other deductions against payroll information for that same period.
5. Compare old and new regimes using the displayed assumptions, then review the annual breakdown before interpreting the monthly average.

Historical selection is not just a cosmetic heading. It follows the calculator's supported dated rules and period labels. Custom contributions and actual payroll overrides still need to be supplied accurately by you.

Worked example: Rs 12 lakh CTC with explicit custom inputs

This illustration deliberately fixes the contributions so the year-label distinction is easy to follow. It is not the calculator's default salary structure or a statutory PF ceiling example.

Assumptions:

• Resident salaried individual, below 60, new regime, ordinary salary income only.
• Annual CTC: Rs 12,00,000.
• Employer PF: Rs 21,600 annually, entered as a custom payroll-confirmed amount.
• Employee PF: Rs 21,600 annually, also entered as custom.
• Gratuity excluded from CTC; no variable pay or other deductions.
• Delhi selected, with professional tax of Rs 0 in this illustration.
• Full-year estimate, no additional income, exemptions or deductions.

The tested calculator result for each of these two supported periods is:

• Gross annual salary: Rs 12,00,000 minus Rs 21,600 = Rs 11,78,400.
• Standard deduction: Rs 75,000, reducing taxable salary, not being subtracted from take-home pay again.
• Taxable income: Rs 11,03,400.
• Estimated income tax including cess: Rs 0, after the calculator's applicable resident rebate.
• Annual in-hand: Rs 11,78,400 minus employee PF Rs 21,600 = Rs 11,56,800.
• Average monthly in-hand: Rs 96,400.

The same result here does not mean every employee's payroll is unchanged across years. The inputs intentionally override PF with identical annual amounts. Effective-dated PF rules, state deductions, actual pay structure and employment timing can produce different results. Read the PF policy guide before using a capped or full-basic preset.

New terminology does not automatically mean new rates

A change in the Act's naming or year terminology is not, by itself, proof that slab rates changed. Our two supported periods share ordinary salary slab assumptions; other dated payroll rules are separate. For how the salary calculation applies deductions and rebates, see the standard deduction and rebate guide and old versus new regime comparison.

What if you changed jobs or worked only part of the year?

Changing the year selector does not combine multiple employers' income or reconcile their TDS. The calculator's employment-period summary is separate from its annualized salary view, and it does not include previous-employer income automatically. Do not treat a single-employer estimate as your complete annual tax liability.

For a separate combined-year estimate, enable the optional previous-employer salary and TDS section. See the mid-year job-change guide and worked TDS example for the correct salary input, employment months and remaining-payroll assumptions. The annualized tables, regime comparison and payslip remain unchanged.

Keep the selected period consistent across salary inputs, payroll records and any professional review. Results remain estimates, not tax, legal or accounting advice. Consult a qualified professional before relying on them for filing or financial decisions.